17/09/2016 Talking Business

largely based on trust. Because without it, I'm just getting into a

stranger's car. I'm Tanya Becket in London. This

week, we will be talking about the gig economy. Its champions say it

provides flexible hours and alternatives incomes and gives

people access to goods and services they could not otherwise afford. Its

detractors say that we are creating an army of low-paid people in

precarious work or are undercutting firms by circumventing tax and

regulation. So who is right? OK, we will go round once. Musicians like

Simon Glenister have been digging for generations. It's precarious

work playing any band and teaching helps give him a stable income. Like

most musicians, I'm a portfolio worker, I have several things I'm

doing. I'm playing with bands, I'm an educator, and doing this digital

stuff as well. So lots of different bits and pieces. But this particular

part, how much does it add in terms of how valuable it is to you in

terms of income? It is not the main thing that I do, but it provides a

reasonable income. I think last year, the gross turnover was ?4500.

It is all front loaded in terms of the stuff that you do, setting the

course is up. It has been fairly minimal upkeep. But most of the

students will never meet Simon in person. Instead, they will learn

Simon's technique by watching his online tutorials. Technology has

transformed gig working into a multi-billion dollar falls in the

economy. It means you can find a much bigger market for your skills

in anything from coding to cleaning. And you can also find an market for

your assets. It reduces the cost because I get some money that I

wouldn't get if I was doing it on my own. This is a long-distance car

share. Marie Poster itinerary on the site and passengers looking for a

ride to London get in touch. They get a cheap car journey in return

for a contribution to her costs. The co-founder of the company sees the

market for empty car seat, homes or even ski equipment, as a way of

getting value from the spare in the economy. Car use is low. A car is

typically used to percent of the time and when it is use it is empty

because you have 1.6 or 1.7 people in the car and a car is typically

decide for five or six people. It is absurd. But with increased

efficiency can come greater risk. Many of these are platforms not

employers, they put people in touch and there are few safeguards for

customers all providers. It is all based on trust. I am joined by a

panel of guests who represent workers, employers and industry.

This is the Chief Executive of love home swap and founding chair of the

industry body sharing economy UK. Dr Elizabeth Cotton is a senior

lecturer at Middlesex business cool and a director of a consultancy. And

joining us from Sydney, Rachel side from the business cool.

If I may start with you, Debbie, intuitively I can imagine that we

all think of sharing things that have little value but when it comes

to our personal safety or even our home, and your business does exactly

that, it's very sensitive? Post-2008, which really date the

development of the modern and digital sharing economy, we have had

to think carefully about how we spend our money. It's no surprise

that the development of the sharing economy was the global economy. What

people have got their heads around is how I think about these assets as

something I can trade. And when you think about something like my day

job, which is my home swap website, people are saving thousands of

pounds on a holiday by swapping their homes rather than staying in a

hotel. What has developed around that has been this becoming much

more mainstream. When I first pitched to raise finance six years

ago, I was told by a number of venture capitalists that nobody

would ever stay in a stranger's home. Fast forward to the summer

when my mother stayed in a stranger's home! We have seen this

becoming more normalised, people feeling will save and secure.

Rachel, you would agree that the impetus for the birth of the sharing

economy is the global recession but this is you of having reputational

capital, or some way of measuring trust or reliability is very

important? Absolutely. The recession was the catalyst that technology is

the game changer. In particular, Mobile, the ability to book things

instantly, removing the friction from exchanges. The real change has

been in trust. How do you measure that? Is there an algorithm, do you

require intellectuals to somehow put some kind of equation across eight?

Trust is a really difficult thing to measure. The way we do this is

through reputation. You see platforms with reviews and ratings.

The most Labour -- basic level is stars. There is an issue with those

because you get a lot of positive buyers. So the platforms get more

sophisticated. What is the behaviour that really matters on that

platform? On Debbie's platform or any other it will be how clean you

are as a guest, have reliable you are, wherever that really won't

matter on people sharing your car. It's not whether someone is clean,

is whether they are a good driver. I think we will look back in a few

years' time and look at the star ratings and realise they were too

basic and we are moving into a future where we are tracking

different behaviours and characteristics that matter to that

marketplace. Debbie, so it is about being explicit about what the

parameters are, what type of trusts people need to have? I think that is

right. One of the thorniest problems has been, can there be an

independently verifiable standards of trust that sits adjacent to all

these platforms. Whereby, regardless of what you are dealing with, homes,

boats, pets, any of the areas where people are sharing, what could trust

mean? For that reason, we have launched the world's first economy

trust seal which we have been promoting with

PricewaterhouseCoopers as an independent assessor. To try and put

in place a kitemark in bit like a fair trademark that platforms can

display to show that they have been independently audited and in order

that they can be trusted as platforms. Elizabeth, let's come

over to the idea of how this might work in terms of being an employee.

When we are an employee normally, we built up capital within a

profession. Is it possible to regarded in this way, that you could

build up trust capital and without Abbey adequate your perspective? No,

I'm afraid not. It's important to distinguish between two things, the

virtual exchange and the model of virtual employer. Despite their

protestations and the legal cases and strike action within delivery

workers that have been going on, these are employers. In a way, there

is nothing new happening through this technology. Most of the people

working for these companies are self-employed and it is a much

misunderstood category of work. It is precarious work. This is an

important principle which will come up again and again. Because

companies like they were having putting huge amounts of money --

companies like Uber have been putting huge amount of money into

blocking lawsuits by workers. There never is an argument that these

platforms cannot wait all these benefits by taking a percentage of

the total fees and not taking this possibility. It's great when

everything is going well but when there is a debt or a problem you

cannot transfer any liability to the provider without providing

protections. But where it gets tricky, I have spoken to hundreds of

these providers and many of these people do not want to be employed.

Especially in the States... They may not want to be employed, but they

may want to be treated fairly. I agree but the debate is getting lost

as to whether these people are employees or independent

contractors, because the categorisation is important to

people. They care whether they have sick leave, whether insurance isn't

appropriate. So we need to talk about how to create a whole new

social safety net. This is where employment is heading. We can't

return to where we were. Our future is where more and more work is

delivered through platforms. Thank you. Later in the programme,

we will be looking at government and trade bodies. But first, let's hear

some words from our comedian. Here is the talking point.

I thought it meant how many gigs are there for me?

If there are lots of comedy gigs, the economy must be good.

If there are not so many, the economy must be bad.

Turns out, the gig economy is way bigger than that.

It's not just at a comedy club, like the one behind me.

Turns out, the whole world is a stage

Players who are on demand, often from an app, at the touch

Speaking of which, got to go to my next gig!

Anyway, a funny thing happened to me on the way

You see, the gig economy is a way of describing small-scale

entrepreneurship where people work gigs, or small jobs

instead of, or as well as, a full-time salaried job.

It's supposed to give you lots of flexibility,

And it's supposed to make you more productive.

It allows consumers to browse their favourite products and brands,

connect with a personal shopper and have those goods delivered

For our customers, we demonstrate the app and they can browse whatever

store as they are looking to shop from.

They will choose their products, for their basket and they

When that order is placed, is going through our fulfilment

area, where we analysed a number of variables on which we will assign

it to the best place personal picker who can fulfil that job

within the time frame of the person who is buying it.

Our personal shoppers are predominantly looking

for flexible work so some of them have full-time jobs.

They work evenings and weekends with us to get extra

revenue and for them, it's an opportunity to do

So what's in this gig for the personal shoppers?

Is it something I could do in my spare time between gigs,

not that I have spare time, because my gig economy is booming.

It's not just personal shoppers' spare time that can be

used to earn money, anything that is unused

Andrea Lenahan is commercial director at Grid Finance.

What we are trying to do is create a vehicle where by people can make

straightforward decisions because the investment product is simple.

But it doesn't take a lot of time. What attracted a lot of people to

working in the gig economy is the uncertainty, the flexibility that

they have to work from their own pace. The downside of that is the

effect it has on planning for their future, planning for their

retirement. So it turns out comedians are not the only ones in

the gig economy. Speaking of which, I've just landed a new one, as a

personal shopper. For my wife. Our in-house gig worker, column. You can

see more of his short films on our website.

Debbie and Elizabeth are still with us. We are discussing the gig

economy. And if reversal from the standard business Gould joins us in

our studio in New York. -- and a professor. Welcome. We were

discussing workers' rights. Is it possible that the sharing economy is

really only suitable for certain people in terms of those who offer

their services, those who offer their labour? Well, I think what we

have to think about the sharing economy as is the future of work.

More and more of the jobs that we think about today as being full-time

and salaries are going to shift over the next two decades to being more

freelance, to shifting the role of the individual from a provider of

labour for money towards the more independent and entrepreneurial.

Once you unpack the structure of work itself, from the social

contract that is wrapped around it you start to realise that the shift

away from provider of labour and towards Ono of sorts, entrepreneur

of sorts, is going to be a good shift in the long run. Elizabeth, I

have a good idea you might disagree! Well, I think it depends whether you

have any assets. Most of all just have our labour so just not earning

money is not an option. Increasingly, you will see more and

more resistance to this flexible as a nation of work. The delivery

workers, had a strike, unheard of for such a campaign. They are

probably scared of standing up for their rights because the phone

stopped ringing. We will see more and more people the wine precarious

conditions unable to continue in these conditions, they will join

unions and they will organise and there will be more strikes. Does the

sharing economy only really work if workers are not protected in the

traditional way? I think there are a couple of different issues going on

here. The first is, platforms working out how their business

models work. And what we have seen with the delivery businesses in the

last months is that if you look from a business does -- perspective in

the demand economy, I know those margins are very small. If you are

thinking about how you can get paid to people getting takeaway is

delivered, you are dealing with single pounds. In order for that to

work, the economic see the stack up. On the other side of the fence it is

the case that people need to be paid the living wage. That is a piece of

regulation that you cannot argue with. So those two things are

clashing with each other. I am obviously in agreement with the

professor that what we are inevitably finding, what we need to

remember, is that there is vast majority of people who want to work

more flexibly, and we should not ignore the fact that they are one of

the key drivers of the changing of the nature of work. I think that is

true but identity problem with the economy is the people that are

working within it. As soon as you get rid of labour protections, they

are gone. The rest of us who would prefer stable employment, don't have

that protection any more. Professor, is that true, this flexible way of

working, what people are calling a move towards a micro

entrepreneurship, means that those of us who want a stable job means we

will have our position is undermined? It is clear that the

structure of full-time employment by itself is not the desirable thing

here. It is all of the benefits and protections and stability that have

been built around it. And we are at the early stages of building the

same stalls of stability, protection around this new model of work but

with the difference that instead of you being someone who is providing

labour in exchange for a salary, you are becoming part of the production

system. You are becoming to some small extent and owner of capital.

If you are a home host you are an owner of the system which is

producing the short-term accommodation. Or you are a

retailer. You go away from being someone who is simply giving your

labour in exchange for money and towards someone who is actually

owner of the capital. And I think that is what the empowering shift

is. At this point, things look more precarious for the freelance worker,

the independent worker, but we are comparing work after 100 years of

progress with a new form of platform based work. Debbie, what is the role

of government in all of this? Government has a very important role

to play. We often but up against regulation which is outdated and

wishes not fit for purpose in a digital age. And -- and which is

not. So if you look at the Greater London Powers act, which made you

couldn't use Eddy Greater London, it was from the 1950s, which meant that

you could not turn a council housing to a hotel. The challenge for

government is the pace of change. Two years ago, all anybody wanted to

talk about around the sharing economy was Eddie n.b., and a level

playing field. -- air B Now it will be something else in two years'

time. Professor, is it unlikely that governments have not picked up on

the change or maybe they have dismissed it as something quirky? I

think what they are having a tough time wrapping their heads around is

that the lines between personal and professional are blurring in the

provision of commercial services. I think short-term accommodation is a

great example. Someone is hosting in their homes instead of working in a

hotel. This is the future of work in some industries but the protections

that we have right now are designed with the expectation that we will

see full-time employment and full-time professionals. So I am

cautiously optimistic that government in the UK and the United

States is starting to see that there are big challenges ahead but there

is certainly movement. There we must leave it. Thank you very much to all

of it. Professor, Dr Cotton, and Debbie Roscoe -- was go.

That's it. Join us next week when our reporter will be in Hanoi

looking at the indications of an ageing population for Asia.